Shares in Tata Motors gain as much as 3.1 percent to a record high of 434.30 rupees after Citigroup raises its price target on the stock to 486 rupees from 421 rupees, citing the outlook for the Indian automaker's luxury unit Jaguar Land Rover (JLR).

Citi says JLR is poised to become the world's fourth biggest luxury car maker on the back of new launches in the next 15-18 months.

Citi also says JLR will benefit from China's growing luxury car market, which the investment bank estimates will grow at around 15 percent over the next two years.

JLR, via its joint venture in China, could sell around 160,000 units by fiscal year 2016, implying an around 8 percent market share, according to Citi.